The Tesla Inc. of Elon Musk seems to be ready to make its low-end electric vehicle available in the Indian market. Though the company hasn’t yet made any official announcements regarding the exact prices, most analysts in the industry have an idea of what could be the passenger EV’s starting price in India based on market forecasts.
International Pricing Context
To this point, Tesla has introduced the Model 3, which is being touted as the company’s least priced vehicle. The Tesla Model 3 has a starting price of about $35,000. However, in some international markets, that price is increased significantly owing to various factors like import duties and taxes and logistical costs.
Import Duties and Taxes in India
In India, the Fully Built Unit (CBU) import duties for EVs are on the higher side. EVs with an ex-factory price exceeding $40,000 attract a hefty import tax going as high as 100%. This effectively doubles the price of the car. For the others, which may come at a price below $40,000, there is some concession, although it is still substantial. EVs in India attract a GST of 5%. Although it is considerably less compared to petrol and diesel cars, it still raises the price.
Projected Price for Entry-Level Tesla EV
Factor in the base price of Tesla Model 3, import duties, taxes, etc., and the estimated price for the least priced electric vehicle in India would be somewhere between ₹50-60 lakhs. This estimate takes into account import duty, goods and services tax, exchange rate, and any other fallout as might be pertinent. However, these are just blind guesses and could change as the final pricing by Tesla materializes, and depending on the further negotiations on import duties.The Tesla Inc. of Elon Musk seems to be ready to make its low-end electric vehicle available in the Indian market.
Possibility of Local Manufacturing
In order to price their vehicles competitively in the Indian market, Tesla may look into local manufacturing or assembly. Setting up a manufacturing facility or product assembly through joint ventures may help it evade whopping import duties and, in turn, generate lower retail prices for its vehicles. Such a move would be in sync with the Indian government’s “Make in India” initiative aimed at persuading foreign companies to manufacture in India.
Government Initiatives and Incentives
There are a number of schemes and policies pursued so aggressively by the Indian government to ensure the adoption of electric vehicles. The Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme offers subsidies to both the manufacturers and consumers, inciting electric vehicle adoption.
Consumer Willingness to Pay
Studies show that Indian consumers have increasingly warmed up to electric vehicles, especially in the upper segment. Research indicates that consumers are willing to pay a premium for an electric vehicle with superior technology, performance, and brand value. Tesla’s reputation for innovation and quality could appeal to wealthy Indian buyers keen to switch to sustainable and frontier automotive technology.
While the exact pricing of Tesla’s cheapest EV in India has not been confirmed, current estimates indicate a range between ₹50 lakh and ₹60 lakh when including duties and taxes, making it more attractive to the Indian market following local manufacturing. As Tesla prepares for entry into India, prospective buyers and industry players are over-anxious to learn of any official announcement regarding pricing and availability.
